The hidden fees banks charge to Brits abroad
Bank charges cost millions of pounds to Brits every time they buy foreign currency and use their cards overseas. Comparing the fees included when they use a debit or credit card is key to paying as little as possible when travelling to a foreign country.
Up to £1bn is ripped-off from British bank accounts every time customers use their card when they are abroad, the official customer body, Consumer Focus has warned. Among other complaints, it said it is unreasonable that up to £30 in fees are charged to Brits who convert £500 into Euros.
Regarding card fees used overseas, the customer body argued that it is not fair that every time Brits pay with their prepaid or credit card or withdraw money, they are forced to pay expensive and obligatory extra charges - usually taking the value of any foreign card transaction and then adding a second service charge.
As an example, the Consumer Focus explained that a Briton taking £200 out of a foreign cash machine with a debit card can be charged about £10.
Furthermore, it criticises that those extra fees are normally unclear and mislead customers. Through a mechanism known as “exchange rate loading”, banks charge customers (many times) without their consent.
A recent study conducted by a comparison site revealed that British holidaymakers run out of cash exactly four days and eight hours into their week-long summer holiday.
The study of 2,000 holidaymakers showed that by day four of their seven day break, holidaymakers have spent all of the £422 they budgeted for the week.
The poll also suggested that 35% of holidaymakers simply visit the cash point to withdraw more money when they run out, while 25% spend on their credit card. More than one in 10 people do a combination of both – and worry about how they’ll pay everything off later.